Lesson 2 Mastery Assignment

Time Line

The First Banks

1791 Bank of the U.S.

The bank of 1791 was our first national bank. The bank was created to help the newly formed United States of America, recover from the debts of the Revolutionary War and helped to establish a common currency in the country. In 1811 Congress voted against the bank and its charter, and was then abandoned.

1816 Second Bank of the U.S.

The second bank of the U.S. was opened in February of 1816. It handled the government transactions for the United State's government. 20% of the stock was owned by the U.S. government, while the other 80% was owned by the public; mostly by wealthy Americans, but thousands of Europeans also owned stock.

Nation's Banking & Currency

Banking Through U.S. History

The Great Depression

In October of 1929 the stock market crashed, thousands of Americans withdrew any money that they had in the bank, fearing it would be lost. Because of the sudden withdrawals, banks had no money to lend and over 9,000 were forced to close. A 3 day banking holiday was announced and there were no financial exchanges to be made, this could have saved over 1,000 banks alone. During this time the Federal Deposit Insurance Corporation (or FDIC) was created it ensured bank accounts of up to $100,000, which has now been changed for up to $250,000.

Glass-Steagall Banking Act

The Glass-Steagall Banking Act helped to separate commercial banking from investment banking. It limited Commercial bank activities, security and affiliations with other commercial banks and security firms.